Question 1 (3 points): Company MNZ faces an opportunity and needs your help on finding out whether it should take advantage of the opportunity. It is considering closing its plant A and opening Plant B in another town instead. To set up the new plant B, in year 0, it needs to make $5,000,000 investment in new equipment, $500,000 in employee reallocation, $10,000,000 in initial set up, and $300,000 miscellaneous fees. While closing plant A, MNZ can liquidate its old equipment and get $1,000,000. The benefits of the reallocation, including but not limited to tax benefits, are estimated to be $2,200,000 each year from year 1 to year 10. The company's marginal tax rate is 21% and its weighted cost of capital is 9%. Suppose the company want to make its decisions on ten year cash-flow analysis (supposing plant B will be closed at the end of the 10th year) to avoid long-term uncertainty.

Q1b Payback Period Approach	Year	Cash flow		Payback (What's left to be paid back)
(1 point)	0
	1
	2
	3
	4
	5
	6
	7
	8
	9
	10
				Payback period